Sunday, October 15, 2006

Client trust account presentation on the Web

Rjon Robins has a nice little online presentation regarding trust account management here over at How to make it rain. I just reviewed it for my first time (they've got a bunch of good free resources including an eBook, e-mail list, and blog if you haven't been to the site before). I think us lawyers tend to give this issue short shirk as too easy or just plain boring (I know I'm guilty of these mindsets). And in reality, trust account management isn't difficult but I suspect many practitioners might be at a similar stage to where I'm at. My trust account(s) were set-up fine up front and I understood trust account management. But quite simply as our clientele has increased the amount of money in our trust account and the number of different clients' money in the trust account makes simple yet critical organization and management very difficult. We're not organized enough in our account management. My takeway points from the presentation:

Only a lawyer or lawyers should be signatories on your Trust account. Many of the horrer stories Rjon references in the presentation involve support staff hijinks with trust accounts.

Open a separate trust account for individual clients (when the size or importance of the client warrants such a move).

Use individual ledger cards for each client. Simply have sort of a checking account ledger for each client for whom retained funds are being held in your trust account.

Proper monitoring systems. Is a secretary opening your mail before you and thus able to manipulate trust funds? Again, this just goes back to many problems involving legal assistants getting lawyers in trouble due to their access to client trust accounts.

Avoid keeping original documents. I never really thought about client original documents in this way but a clients original documents are trust property. If you have them in the file, you'll be having to keep that file forever.